Excuse me - Obama screwed the bondholders on the GM bailout, and this bailout will cost the taxpayers billions. What did Romney and Bain do by comparison. You folks are tilting to the left just a wee bit too much - losing your equilibrium, you are.

It's simply calling out the extreme hypocrisy of the right. Republicans tout over and over that the government doesn't help business but that only business people help business...and nothing could be further from the truth -- as evidenced by the $10 million bailout Mitt and Co. extorted from the federal government.

Despite our you and our recent government’s apparent desire to treat banks and bankers like children, I think that we would be all be better off if we would just let those who take the risks bear the pain. Yes, those banks would have had to take a 27 million dollar write-down, but it certainly would have been a learning experience for them. And how can you put a price on education?

Remember, these were two parties who entered in to a contract. Just because Romney took the time to read it, doesn’t mean what he did was ethically wrong.

Instead of a good education, these bankers learned that it’s really not that important to read these contracts. Ol’ Uncle Sam has got their backs and he'll come bail them out the next time trouble comes. In economic, we call these actions moral hazards.

"A campaign source notes that Mr Romney had nothing to do with writing the original loan covenants that allowed paying staff before creditors. Mr Romney was at Bain Capital when the agreements were made, before he returned to Bain & Company."
~ Correct. It was written by his father who had already pilfered so much that he felt he should give his son a chance to pillage. The deference between Romney who screwed a bank and Madoff who screwed rich individuals is just that... a line so thin that quantum physics just doesn't do it justice.

This is not a "bailout" in any sense of the word. This is no different than what the FDIC does with any other creditors and debtors involved in an FDIC takeover of a failing bank -- they switch good loans over to the new bank, and cash out or write off any "bad" loans that might be on the books. I would be interested to see what other debtors were required to pay in return for closing out their bank loans -- my guess is that most either had nothing change (like most mortgagors) or they were able to negotiate a reduced cash-out like Bain.

You are aware Bain was NOT a bank, right? Ergo... bailout with a bank taking a hit on the loan due to very shady language in the loan contract and FDIC had to backstop the bank with federal dollars. Not tax dollars per se, but still...

Rolling Stone is totally in the tank for Obama. More smears in the hope of bringing Romney down. Right now Romney is the only hope this nation has of being saved. Obama has shown his big government spending does not work. The country cannot take 4 more years of mismanagement.

Obama has spent less Federal dollars than any other president in some time. Look it up. He is dealing with a cumulative debt not of his making. As evidenced by this Rolling Stone story and another regarding Bain's tactics in leveraged buyouts, Romney is a sleazy operator. His promise to create 12 million jobs with no details of how he will do this is just another example of his conviction that he can put one over on voters. Sorry about your ignorance.

... unless you're in the business of debt reduction and not interested in lifetime Veterans' Administration healthcare costs for a generation of wounded warriors unable to support themselves due to crippling physical and mental injuries. I.e. the American taxpayer sees more foreign war stimulus rising the debt rather than domestic investment stimulus. This is the issue that needs to be talked about in this campaign: the inevitability of Romney finding a decade-long war commitment somewhere in the world in the next 4 years.

This is not new. In Romney's LBO business, it works best when there are banks dying to lend money. It does not matter if Bain re-sell its investments to another PE firms or cash out via IPO, there are banks in the ecosystem holding the bag (risks).

In term of rescuing Brain Consulting, Romney just applied the same tactic he had perfected in the Bain Capital side of the business.

I'd imagine that news of the stunning, mind-bogglingly stupid clause in the bank loan was what saved the company. Word gets out, and CEOs everywhere crowd in waving cash to find out how they can get some of that.

How about 'By doing this, Mitt Romney showed he had what it takes to find a way to do the job he was hired for. After four years do you feel that President Obama has what it takes to do the job you hired him for?'

Will that maybe do the trick?

I don't much like Romney, but clearly the banks screwed this up, and he wouldn't have been doing his job if he had foolishly refused to take advantage of that.

Wrong. It take a brain dead economist to recommend a country default on its loans. Look at Argentina or Russia. In "This Time is Different" Reinhart shown that both were worse-off for having defaulted on their debt.

So if something is there to be taken advantage of then it is ok to do so? That is a very dangerous line of thinking. For example, "hmmm, my neighbors are out of town and have no alarm, I should go in there and steal their stuff. It is their fault for going out of town!", or perhaps you feel Jerry Sandusky should have walked because it was the children's fault that they were vulnerable.

I may be incapable of recognizing sarcasm (actually, I think satire is a better word). However, --satire or no --Eusebius Pamphili’s argument is incorrect because the situations are not analogous. The argument which follows Pamphili’s statement “by that logic” does not in fact apply the same logic. What Romney did is not the same as your hilarious sarcastic example.

There are long term implications and costs which are applied to countries that nationalize foreign assets or default on their debt. For example YPO in Argentina is currently unable to raise the necessary capital to make investments into the Argentine energy sector.

The US could threaten China by use of nuclear or conventional force and achieve a write-down in its debt. However, in the long term, things like capital flight and breakdowns international trade would far offset the any benefits of a write-down. On the other hand, Bane’s write-down was not disclosed by the markets and Romney could expect no penalties applied to the future prospects of Bane.

Countries don't pay down their debt just because it is moral, right, and they said they would. Countries pay down their debt because there is no such thing as a free lunch and the benefits of defaulting are usually outweighed by the costs.

Hmmm... a banker signs up to a loan whereby if the borrower goes into default the executives who ran the borrower into default get the first crack at the borrower's cash.

Does the article mention if these bankers are working anywhere else these days? If they are I have a proposition that they will not be able to resist. It involves putting up a bridge as collateral......

Forget all the bailout talk, what really gets me about this is that he got 50% of his debt erased and the company continues on-ward with new loans and new investments

Where can I dump 50% of my debt and not be labeled a financial deadbeat? It just feeds into the sense that there is one set of rules for average people and another for the super wealthy (or super wealthy corporations in this case).

Why did the FDIC do it? They figured they'd be better off writing down the loan rather than liquidating.

The FDIC considered finding a buyer to take over its loans to Bain, but analysts concluded that "Bain has no value as a going concern." And the government wasn't likely to get much out of Bain if it allowed the firm to go bankrupt: The loan agreement engineered by Romney had left the FDIC "virtually unsecured" on the $30.6 million it was owed by Bain.

"Once bonuses are paid," the analysts warned, "all members of the bank group believe this company will dissolve during 1993."

About the only assets left would be Bain's office equipment. The records show FDIC analysts pathetically attempting to assess the value of such items, including an HP LaserJet printer, before concluding that most of the gear was so old that the government's "portion of any liquidation proceeds would be negligible."

How had Romney scored such a favorable deal at the FDIC's expense? It didn't hurt that he had close ties to the agency – the kind of "crony capitalism" he now decries. A month before he closed the 1991 loan agreement, Romney promoted a former FDIC bank examiner to become a senior executive at Bain. He also had pull at the top: FDIC chairman Bill Seidman, who had served as finance chair for Romney's father when he ran for president in 1968.

The federal documents also reveal that, contrary to Romney's claim that he returned full time to Bain Capital in 1992, he remained involved in bailout negotiations to the very end. In a letter dated March 23rd, 1993, Romney reassured creditors that his latest scheme would return Bain & Company to "long-term financial stability." That same month, Romney once again threatened to "pay out maximum bonus distributions" to top executives unless much of Bain's debt was erased.

In the end, the government surrendered. At the time, The Boston Globe cited bankers dismissing the bailout as "relatively routine" – but the federal documents reveal it was anything but. The FDIC agreed to accept nearly $5 million in cash to retire $15 million in Bain's debt – an immediate government bailout of $10 million. All told, the FDIC estimated it would recoup just $14 million of the $30 million that Romney's firm owed the government.

It was a raw deal – but Romney's threat to loot his own firm had left the government with no other choice. If the FDIC had pushed Bain into bankruptcy, the records reveal, the agency would have recouped just $3.56 million from the firm.

Thank you for 20-year-old timeline. Perhaps you can forward it to President Clinton who, as recently as May, told CNN that Mitt Romney's business record at Bain Capital was "sterling."

"I don't think that we ought to get into the position where we say 'This is bad work. This is good work,'" Clinton said. "The man who has been governor and had a sterling business career crosses the qualification threshold."

This leaves the political question of how to distinguish (beforehand, with imperfect knowledge) a loser from a troubled entity worth saving. And perhaps only time will tell whether the Making Home Affordable programme or the GM bail-out were more like the Bain example (keeping worthy but troubled borrowers alive), or were cases of temporarily resuscitating terminal cases that should better have been left to the bankruptcy system.

Instead of the 2008 G.M. bail-out, which, incidentally, went into a managed Chap. 11 bankruptcy in June 2009, I'll use the example of Solyndra. Here is a timeline from The Center for Public Integrity beginning in 2005. It is tagged The White House: Profiles in Patronage: Solyndra. (You can click on the "Profiles in Patronage" for other examples).

I'll pick it up from 2008 --

Missed warning signs: A Solyndra timeline

2008: As Solyndra’s loan application proceeds, Fitch Ratings assigns the company a less than stellar B+ credit rating, and Dun & Bradstreet assesses its credit as “fair.”

March 2009: Energy Secretary Steven Chu announces Solyndra will receive the Energy Department's first energy loan guarantee—a $535 million financing to expand the company’s solar rooftop production. From the release: “Secretary Chu initially set a target to have the first conditional commitments out by May—three months into his tenure—but today's announcement significantly outpaces that aggressive timeline. Secretary Chu credited the Department's loan team for their work accelerating the process to offer this conditional commitment in less than two months.”

Sept. 2009: The loan closes and Solyndra begins construction of its "Fab 2" factory to expand its production line. Chu and then-Gov. Arnold Schwarzenegger attend the groundbreaking. "This announcement today is part of the unprecedented investment this Administration is making in renewable energy and exactly what the Recovery Act is all about," Vice President Joe Biden says via teleconference. U.S. Treasury’s Federal Financing Bank issues the loan.

etc., etc., etc.

Feb. 28, 2011: Solyndra announces it has raised $75 million in financing led by the corporate entity of George Kaiser, Solyndra’s chief financial backer and a bundler of campaign donations for Obama. DOE refinances its loan to extend Solyndra’s payoff date – and agrees to put investors in line first in case of default. “The Department reached an agreement with Solyndra that gave the company and its 1100 employees a fighting chance to go forward,” DOE said.

etc., etc., etc.

Sept. 6, 2011: Solyndra files for bankruptcy. Investors who infused the company with cash will be repaid before the government.

The Solyndra loan was initiated by the Bush administration in 2007. One of the earliest and largest original investors in Solyndra was Madrone Capital Group, which is funded by the Waltons (as in Wal-mart, not John-boy), who are big GOP donors.

I'm sorry. I posted a broken link so you weren't able to double-check the timeline. As far as I can tell, the Bush administration did not initiate the loan, but rather Solyndra filed an application for a DOE loan guarantee in Dec. 2006

2005: Solyndra Inc. is founded by Dr. Christian Gronet.

2006: The company opens its headquarters in Fremont, Calif.

Dec. 2006: Solyndra files an application for a Energy Department loan guarantee just before the New Year.

2007: Production begins on the company’s solar rooftop panels.

2008: As Solyndra’s loan application proceeds, Fitch Ratings assigns the company a less than stellar B+ credit rating, and Dun & Bradstreet assesses its credit as “fair.”

Yes but there were major warnings to the Obama administration that things were not right at Solyndra and because of Obamas donors being heavily invested in Solyndra they all ignored the warnings within their own walls.Just before it went bankrupt they structured it so these investors got paid before the taxpayers.

That sounds eerily like the standard practice of Bain Capital. If this kind of behavior appalls you, then you might be interested in Matt Taibbi's article in the Sept 13th edition of Rolling Stone called "Greed and Debt: The True Story of Mitt Romney and Bain Capital"

This article details a misleading Romney campaign ad about the DOE's lending of money to green companies.

Here's a quote about your favorite topic, Solyndra: "According to Bloomberg News, even with the losses from Solyndra, the default rate for the DOE’s loans to solar, wind and bio-energy projects is less than 3.6 percent, less than a third of what the White House anticipated."

"According to Bloomberg News, even with the losses from Solyndra, the default rate for the DOE’s loans to solar, wind and bio-energy projects is less than 3.6 percent, less than a third of what the White House anticipated."

-factcheck.com

There is an ongoing checkup on all companies, initiated by the Whte House. Your information is wrong.

To modify Alfred P. Doolittle's line from George Bernard Shaw's "Pygmalion", "I am a member of the undeserving" middle class. I make enough money to have a good life. But I do not make enough to qualify for any of those tax breaks that benefit only the wealthy.

"Mr Romney thought that Detroit carmakers should be allowed to go bust rather than getting federal help. "
Oh that is true. But, you see, the executives would all enjoy bonuses as Detroit was being shut down, as would consultancy firms brought in to handle the process.

If you look at a spoof, below, by New Conservative, of Romney's thinking while 'interesting' his executives in the bonuses some person with willingness to extort in certain circumstances thought to get inserted in the contract Bain had with a creditor, you might begin to change your mind, Manly Horse. Here's the spoof of Romney talking to his about to be bonused execs:

"Guys, I may have to give you some hefty checks soon. It's for the negotiations. I know we all agree that we don't deserve these checks and that it will hurt to cash them. But I have to give them to you for negotiation purposes. I never in normal circumstances would take the drastic measure of ordering the company to write me and the people who hired me huge checks. It pains me that I have to do something so alien to my worldview that failing companies should be allowed to fail."

Hard to figure out how an honest Mormon bishop could hold all that much guff in his head, eh? If so, then ask yourseld if your wife had cancer, would you ask her to undergo with you the rigours of a presidential campaign? Of course, it was her choice, and the USA is a free country, isn't it, so the Republican candidate can hardly be held accountable, can he. But again, would you, Manly Horse, ask your wife in such circumstances to do such a thing?

I can't speak for Manly Horse, but I can tell you that John Edwards would and did. He also had an extra-marital affair with a filmmaker hired by his campaign staff, knowing his wife had breast cancer. I should hope I don't need to go into further detail, Angus, and Elizabeth Edwards died two years ago.

I take it you never read Obama's own books. His mentor was Frank Loyd Davis a self proclaimed communist and his buddies in college were socialists and radicals. Obama was never vetted. If he had been he never woud have been a candidate.

I don't recall that there's anything illegal in this country about studying different political philosophies. Also, Democrats generally don't buy into the Red Scare type of propaganda that you're peddling.